Skip to main content

Payment for Charter Hire in Advance

B-193687 Aug 22, 1979
Jump To:
Skip to Highlights

Highlights

The Assistant Secretary for Maritime Affairs requested that GAO determine whether the United States, as represented by the National Shipping Authority (NSA), may, in time of war and in accordance with arrangements made under the North Atlantic Treaty, pay charter hire in advance for ships allocated for use by the United States from a pool of North Atlantic Treaty Organization (NATO) flag shipping. The Planning Board for Ocean Shipping, a NATO civil emergency planning body, has developed plans for wartime shipping operations in its NATOTIME Dry Cargo Charter Party (NATOTIME Agreement). The United States has approved the draft agreement subject to a reservation concerning clause 10 which provides for charter hire to be paid in advance. The issue is whether United States approval of this clause is prohibited by legislation which states that "no advance of public money shall be made in any case unless authorized by the appropriation concerned or other law." Legislation authorizing Government agencies to make advance payments on contracts without regard to other provisions of law relating to contracts is effective only during a national emergency declared by Congress or the President. However, a Presidential Proclamation of December 16, 1950 which declared a national emergency has never been repealed and continues to provide the basis for using that law. Other legislation gives NSA the authority to sign the advance hire agreements. Provided the determination is made that the national defense will benefit by the NATO arrangement, the advance payments under clause 10 of the NATOTIME Agreement would be legally permissable.

Downloads

GAO Contacts

Office of Public Affairs